If your startup was a boat, what kind of boat would it be?
Is it a speedboat or a sailboat?
When it comes to startups who don't know what type of boat to build, they are likely to be lost at sea.
Let's face it, most entrepreneurs sink. We see it happen all the time.
With being founders ourselves and making investments into companies including Bonobos, Birchbox, Warby Parker, Pinterest, Lyft, Krave Jerky, Kevita, and numerous others, we have come an eye-opening realization.
Faster is not always better.
In fact, depending on your business model and positioning in the marketplace, slower might keep you from drowning.
Still not sure if your startup is a speedboat or sailboat? Answer the following questions 3 questions:
Is your company the first mover in an industry?
Is your company growing a high rate with an even higher burn rate?
Is your company like Lyft?
If you answered "no" or "not sure" to any of these, keep reading to learn why your startup is best off with a sailboat strategy. We will not only prevent your company from sinking, but can help you successfully reach the destination you are trying to reach.
Think of a sailboat as a company that's heading--not racing--in a general direction and trying to position itself in the tailwinds of favorable trends. Contrast this with a speedboat--an early entrant usually characterized by unsustainably high growth and burn rates--sprinting towards the finish line.
You think that a speedboat pedal-to-the-metal strategy is the best way to build a great startup, right?
The sailboat strategy may work better for your business.
Because sailboats can go longer without any gas, and can take advantage of emerging trends that not everyone else can see.
A major benefit of sailboats is the ability to spot incoming trends--whether they're rooted in changes in consumer behavior or the macroeconomic backdrop--and take advantage of the winds that guide them.
Consider Kevita, the manufacturer of sparkling probiotic drinks. Founded in 2009, it had a hunch that consumers would soon view kombucha as a fitting health drink, so it placed its product in a few stores and waited for consumer behavior to shift accordingly.
Unlike a speedboat, this "float around the rim" strategy doesn't attempt to create trends--rather it attempts to exploit them.
Being a sailboat allows you leverage particular trends at just the right time. The time when customers do not need to be convinced that they need your product. The time when they want your product. A time when speedboats have already raced past the customers and emerging trends.
Time Is on Your Side
It's no surprise that the sailboat's journey may be more drawn-out than that of a speedboat. A keen startup sailor is patient and lets the wind blow them in the direction of market trends.
View this as a massive opportunity and unfair advantage.
Sailboats can capitalize on this extra time to iterate, identify customers, and build brand loyalty before their trends take off. Get to know the surrounding water before exploring the rest of the ocean; for instance, focus on building relationships with your local target demographic.
If you execute correctly, word-of-mouth referrals--the cheapest, most effective marketing form--will put more wind in your sails and bolster your presence throughout the local area and facilitate the movement to new locations. With an established base of customers willing to vouch for you, you will be in a perfect position to capitalize on the winds of the consumer trends, meeting customers where they are at in real time.
This is in direct contrast with the speedboat's need to constantly convince customers why they need it, burning gas and making big waves in the process.
This is not to say that the speedboat strategy is impossible--it often seems like the most famous startups rise seemingly overnight. But, we can attest from experience that the vast majority of these companies end up out of gas and lost at sea. The protracted, thought-out, journey of the sailboat proves more often than not to be more successful in reaching the promised land filled with customers who are ready to buy.
With all this in mind, it is time to pack up your startup sailboat, set the sails, and (patiently) sail into startup success.